ORDER

SRI.H.R. SRINIVAS, PRESIDENT

1.     This is the complaint filed by the complainants against the Opposite Parties (herein referred to as OPs) under Section 35 of the Consumer Protection Act, 2019 for the deficiency of service in repudiating the insurance claim in respect of his vehicle car Mahindra Scorpio SLE bearing No.KA-04 MJ-3217 which was burnt in a fire accident when it was parked and for damages of Rs.8,00,000/- along with interest at 18% per annum and also Rs.1,15,000/- for causing mental agony, hardship and for cost and other reliefs as the commission deems fit.

2.     The brief facts of the complaint are: Complainant is the owner vehicle No.KA-04 MJ-3217 Mahindra Scorpio SLE, purchased by paying a sum of Rs.5,50,000/- and he had been to air show organized by the authorities  on 23.02.2019 and had parked his vehicle in the parking area allotted by the authorities. At about12:00 noon he came to know that there was a fire accident wherein about 200 cars were destroyed due to fire accident.  He is a business man doing business and due to loss of his vehicle he had to spend Rs.1,000/- per day to travel for his business and he has incurred expenses in respect of his transportation.

3.     After purchasing the vehicle from its previous owner he got registration certificate transferred to his name from the concerned RTO authorities whereas, due to unavoidable circumstances, he could not get the insurance policy of the vehicle transferred to his name form the previous owner.  When he made a claim in respect of the destruction of his car due to fire to OP-1, as the insurance was still in force, OP-1 rejected his claim on 05.03.2019 stating that there is no privity of contract between the insurance company and complainant as the insurance policy has not been transferred.  All efforts made by the complainant to get the insured amount in respect of his car failed due to the deliberate intention of OP-1. He had lodged a complaint in respect of the fire accident to the car with Yelahanka New Town Police Station. Due to their insistence he had to remove the charred car from the premises of the fire accident that i.e. Indian Air Force area and sold it as a scrape for Rs.10,000/-. The act of OP-1 in repudiating the claim amounts to deficiency in service and hence prayed the commission to allow the complaint and award as prayed in the complaint.

4.     Upon the service of notice, OP-1 appeared before the commission filed the version whereas, OP-2 who is the financier for the complainant to purchase the second hand vehicle, remained absent even after the service of notice and hence placed exparte.

5.     In the version filed by OP-1, it is contended that the complaint is not maintainable either in law or on facts and there is no cause of action to file the complaint against the OP-1. It has admitted that vehicle No.KA-04 MJ-3127 has been insured with it for the period 07.04.2018 to 06.04.2019 in the name of one Jayalakshmi.M subject to the terms and conditions and exclusions under the policy which also governed under the provisions of Motor Vehicle Act 1988. The insurance cover given through the said Jayalakshmi was under Private Care Package Policy. As per section 157(2) of Motor Vehicle Act 1988 the transferee shall apply within fourteen days from the date of transfer in the prescribed form to the insurer for making necessary changes in this regard, in the certificate insurance, and the policy described in the certificate in favour of the complainant, so as to make necessary changes in the certificate of insurance.

6.     In this case, even after getting the vehicle transferred on 19.01.2019 itself, through the RTO to his name, the complainant did not make any application to get the insurance transferred  to his name.  As such, there is no privity of contract between the insurance company and the complainant and the insurance company is not liable to pay any of the claim made in the complaint. Further it is not within its knowledge regarding complainant spending Rs.1,000/- per day for his travel expenses.

7.     It is further submitted that automatic transfer of insurance policy is applicable only in respect of death or injury to the third party or damage to the property of third party as provided under Section 157(1) of the Motor Vehicle Act. In respect of any damage to the vehicle the provision of Section 157(2) is applicable and it is mandatory on the part of the purchaser to apply to the insurer to transfer insurance in his favour to avail the benefit accrued under the insurance policy and violation of section 157(2) entitles the insurance company to repudiate the claim.  In view of the above contention, OP-1 prayed the commission to dismiss the complaint as complainant has violated the terms and conditions of the insurance policy and there is no contract between them and hence there is no deficiency in service.

8.     In order to prove the case, both parties have filed their affidavit evidence and produced documents. Arguments Heard. The following points arise for our consideration:-

1. Whether the complainant has proved deficiency in service on the part of the opposite parties?

2. Whether the complainant is entitled to the relief prayed for in the complaint?

9.     Our answers to the above points are:-

POINT NO 1: In the Affirmative

POINT NO 2 : Partly in the affirmative

                      For the following.

REASONS

POINT NO 1:

10.   Upon perusing the affidavit evidence, documentary evidence it becomes clear that, complainant purchased vehicle bearing No. KA-04 MJ-3127 and got the RC changed to his name (ExP1). He has produced  Ex-P2 the exhibitor invitee ticket for Gate No.5 for Aero India Air Show Exhibition from 20-24 February 2019, Ex. P3 is the complaint given by the complainant to the police inspector, Yalahanka Police Station, Bangalore in respect of the fire accident in the car parking area of the air show.  Ex P4 is the Panchanama drawn by the police wherein nearly 277 cars were destroyed in the fire, whereas another 24 cars damaged while taking them out of the range of the fire. RTO inspection report is also filed wherein it is mentioned that car No.KA-04 MJ-3127 has been destroyed beyond repair condition and it is not road worthy. Ex.P6 are the three letters written by the complainant to OP-1 seeking claim. Ex. P7 is the insurance policy issued by OP-1 in favour of one Jayalakshmi M on 07.04.2018 till the mid night of 06.04.2019 . The ID value of the vehicle is mentioned as Rs.3,34,000/-. 

11.   It is to be noted here that, the fire accident in which the car of the complainant destroyed is on 23.02.2019  which is well within the insurance coverage period. OP-1 has collected a sum of Rs.12,335/- in all towards own damage and liability to third party coverage.  Ex P8 is the copy of the repudiation letter dated 05.03.2019, wherein it is stated that there is no contract of insurance between the complainant and Oriental Insurance company (OP-1 in respect of vehicle No.KA-04 MJ-3127) and hence repudiated the claim. These facts are not at all in dispute.

12.   OP-1 has produced Ex R2 the Indian Motor Tariff and contended that as per GR-17 transfers:-

“GR.17.TRANSFERS

On transfer of ownership, the Liability only cover, either under a Liability Only policy or under a Package policy, is deemed to have been transferred in favour of the person to whom the motor vehicle is transferred with effect from the date of transfer.

The transferee shall apply within fourteen days from the date of transfer in writing under recorded delivery to the insurer who has insured the vehicle, with the details of the registration of the vehicle, the date of transfer of the vehicle, the previous owner of the vehicle and the number and date of the insurance policy so that the insurer may make the necessary changes in his record and issue fresh Certificate of Insurance.

In case of Package Policies, transfer of the “Own Damage” Section of the policy in favour of the transferee, shall be made by the insurer only on receipt of  a specific request from the transferee along with consent of the transferor. If the transferee is not entitled to the benefit of the NO Claim Bonus (NCB) shown on the policy, or is entitled to a lesser percentage of NCB than that existing in the policy, recovery of the difference between the transferee’s entitlement, if any, and that shown on the policy shall be made before effecting the transfer.

A fresh proposal form duly completed is to be obtained from the transferee in respect of bothliability  only and package policeis.

Transfer of Package Policy in the name of the transferee can be done only on getting acceptable evidence of sale and a fresh proposal form duly filled and signed. The old Certificate of Insurance for the vehicle, is required to be surrendered and a fee of Rs.50/- is to be collected for issue of fresh Certificate in the name of the transferee. If for any reason, the old Certificate of Insurance cannot be surrendered, a proper declaration to that effect is to be taken from the transferee before a new certificate of insurance is issued.”

 Under which the counsel for OP-1 prayed the commission to dismiss the complaint.  He has also relied on the decision reported in: (2014) CPJ 128 (NC) and also I (2014) CPJ 493 (NC) wherein if the transferee fails to inform the insurance company about transfer of registration certificate in his name, policy is not transferred in the name of the transferee insurance company cannot be held liable to pay in case of own damage of vehicle, no illegality, irregularity or jurisdiction error in the impugned order.

13.   Similarly insurance policy was required to be transferee in the name of the transferee on damages of vehicle as per India Motor Tariff Rules application from 30.06.2002 - respondent was entitle to own damages of vehicle only if he had applied for transfer of insurance policy in his name within 14 days from the date of transfer of registration of certificate in his name - Transfer not done - repudiation is justified.

14.   This complainant has relied on decision of the Hon’ble Supreme Court of India reported in 2014 SAR (CIVIL) 582. It is held in the said decision that, “Once the ownership of the vehicle is admittedly proved to have been transferred the existing insurance policy in respect of the same vehicle will also be deemed to have been transferred to the new owner.”  This judgment is of two judges bench of the Hon’ble Supreme Court of India. It has also discussed the provision of Section 157(1) of the Motor Vehicle Act in Para 10 and 12 of the said judgment.

15.   It has also relied on the provisions of Section 157(1) of the Motor Vehicle Act 1988:

“157. TRANSFER OF CERTIFICATE OF INSURANCE

(1) Where a person, in whose favour the certificate of insurance has been issued in accordance with the provisions of the Chapter, transfers to another person the ownership of the motor vehicle in respect of which such insurance was taken together with the policy of insurance relating thereto, the certificate of insurance and the policy described in the certificate shall be deemed to have been transferred in favour of the person to whom the motor vehicle is transferred with effect from the date of its transfer.

Explanation: For the removal of doubts, it is hereby clarified that such deemed transfer shall include transfer of rights and liabilities of the said certificate of insurance and policy of insurance.

16.   In view of the above decisions of the Hon’ble Supreme Court of India holding that, the transfer of the vehicle to the name of the purchaser the insurance is also deemed to have been transferred (deemed provision) the contention of OP-1 and the decision on relied on by it which is passed by the NCDRC cannot be any help to OP-1. Hence repudiation of the claim amounts to deficiency in service. Hence we answer POINT NO.1 IN THE AFFIRMATIVE.

POINT NO.2:

17.   In view of our answer to Pont No.1 in the affirmative, complainant is  entitle for compensation to the extent of the value of the vehicle which he/his vendor had insured with OP-1. As pointed above, the vehicle was insurance with OP-1 for a sum of Rs.3,34,000/- only.  The claim of the complainant in this case is Rs.8,00,000/- which cannot be accepted.  Hence the complainant is entitle to Rs.3,34,000/- only less Rs.10,000/- already received by selling the remaining of the destroyed car as scrap along with interest at 12% per annum from the date of repudiation i.e from 05.03.2019 till payment of entire amount. Further the repudiation of the claim of the, complainant was put to hardship, mental agony, and financial loss for which we direct OP-1 to pay a sum of Rs.50,000/- towards compensation and Rs.10,000/- towards litigation expenses.  Since there is no prayer in respect of OP-2 and also no evidence regarding OP.2’s liability and also negligence or otherwise proved against OP-2 and the complaint against OP-2 is liable to be dismissed. In view of this, we answer POINT NO.2 PARTLY IN THE AFFIRMATIVE and pass the following:-

ORDER

1. The complaint is partly allowed with cost.
2. OP-1 i.e. The Oriental Insurance Company Limited represented by its Regional Manager/Authorized Signatory is hereby directed to pay a sum of Rs.3,24,000/- along with interest at 12% per annum from the date of repudiation i.e. on 05.03.2019 till payment of entire amount.
3. Further OP-1 is hereby directed to pay a sum of Rs.50,000/- towards damages and Rs.10,000/- towards the litigation expenses to the complainant.
4. OP-1 is hereby directed to comply the above order within 30 days from the date of receipt of this order and submit the compliance report to this Commission within 15 days thereafter.
5. Complaint against OP-2 is hereby dismissed.
6. Send a copy of this order to both parties free of cost.

Note: You are hereby directed to take back the extra copies of the Complaints/version, documents and records filed by you within one month from the date of receipt of this order.

(Dictated to the Stenographer over the computer, typed by him, corrected and then pronounced by us in the Open Commission on this day the 17^th  day of February 2022)

MEMBER                        PRESIDENT

ANNEXURES

1. Witness examined on behalf of the Complainant/s by way of affidavit:

Copies of Documents produced on behalf of Complainant/s:

Ex P1: Copy of the Registration Certificate

Ex P2: Copy of the Exhibitors invitee.

Ex P3: Copy of the complaint

Ex P4: Copy of the Mahazar conducted by Yelahanka PS

Ex P5: Motor Vehicles report

Ex P6: Copy of the letter written by complainant to OP.

Ex P7: Copy of the Insurance certificate.

Ex P8: Copy of the repudiation letter

2. Witness examined on behalf of the Opposite party/s by way of affidavit:

RW-1: Sri Hanumantha Raju, Assistant Manager of OP-1.

Copies of Documents produced on behalf of Opposite Party/s

Ex R1: Copy of the authorized letter issued by the Manager

Ex R2: Copy of the Indian Motor Tariff.

MEMBER                         PRESIDENT

RAK*